WASHINGTON, DISTRICT OF COLUMBIA (Washington Post) - One of Mexico’s most successful environmental rescue projects, a newly thriving coral reef, is under threat from a Cancun-sized mega-development planned for the Baja California Peninsula, activists said Thursday as they staged a protest to put pressure on the Spanish developer.

The project would transform the village of Cabo Pulmo from a sleepy clutch of bungalows and small homes into a development with the equivalent of about 30,000 hotel rooms, golf courses and a marina on a strip of seaside desert about a 90-minute drive northeast of the Los Cabos resorts.

Environmentalists fear that pollution, vacation activities and sediment from construction and dredging could damage the coral in a national marine preserve that had achieved rare success in restoring sea life. They say thousands of homes would have to be built for resort employees in an area where water is scarce.

The World Wildlife Fund brought schoolchildren bearing the flags of 70 countries on Thursday to present almost 13,000 signatures from around the world asking President Felipe Calderon to cancel permits, now held by a regional Spanish bank, for construction at the site.

“It is unique, not only in Mexico, but in the world,” said Omar Vidal, the head of the WWF in Mexico. “It is a nursery for marine species to repopulate many areas of the Gulf of California,” a body of water once described as ‘the world’s aquarium” by pioneering diver Jacques Cousteau, but which has since been severely damaged.

Seventeen years ago, Cabo Pulmo’s shallow reef, parts of it just 30 feet (10 meters) offshore was typical degraded reefs. Commercial boats fished directly overhead, often dragging their anchors through the coral, to get at valuable species that lived there.

“We started noticing there were fewer fish, and we were having to go farther out,” said Judith Castro, 39, whose family has been fishing in the area for about a century. “We just saw the reef as a garden. We didn’t know the importance of it,” said Castro.

In 1995, with support from a local university, the government declared the reef a protected area and later upgraded it to marine park status.

The effort was aided by local residents who largely transformed their economy from fishing to ecotourism, and the amount of life on the reef blossomed. A study by the Scripps Institution of Oceanography in California found that the biomass at the Cabo Pulmo reef — the total weight of living species — rose by 460 percent.

“No other marine reserve in the world has shown such a fish recovery,” wrote Octavio Aburto-Oropeza, one of the authors of the report, in a Scripps Institute article.

“It’s impressive,” said Castro, whose extended family now runs dive shops, bungalows and restaurants at Cabo Pulmo instead of fishing. “Independently of what the scientists find, we can see it every day, in the amount of fish and the enormous number of sharks in the area.”

The reef is now so healthy that fish migrate from it to neighboring areas, helping fishermen there, Castro said.

The developers say their project won’t damage the reef, and have offered 1 million pesos ($78,500) per year as a contribution to help preserve the protected area.

The company says the marina will be located about 10 miles (17 kilometers) from the main reef, but critics say the land portion of the property actually borders the protected area.

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Mexico’s Environment Department granted approval for the initial stage of the project in 2008, though environmentalists allege that the promoters did not submit any serious studies about whether ocean currents might carry runoff onto the reef or what impact the increase in boats, snorkelers and divers would have.

Department spokeswoman Laura Aguilar said tough additional conditions were imposed on the project in 2011 and said it would “take years” for developers to meet them. Until then, they cannot build anything, she said. “The truth is, I don’t know if they can do it, I don’t know if the company is in any condition to do it,” Aguilar said.

The project’s backer, a division of Spanish resort developer Hansa Urbana, ran into financial problems during Europe’s financial crisis, in part because it overextended in building sprawling resorts along the Spanish coast. In 2011, as part of Spain’s reorganization of troubled assets, it was largely acquired by a regional Spanish bank, Banco Sabadell.

It is unclear if Sabadell plans to sell the project or develop it: The offices of Banco Sabadell and Hansa Urbana in Mexico both said they could not comment on the dispute.

On its web site, the developer rejects comparisons to Cancun, which had about 28,000 hotel rooms in 2010, saying the project would be smaller and more environmentally friendly than the sprawling Caribbean resort that has seen environmental problems such as beach erosion and the pollution of a nearby lagoon.

The developer’s site promises “to preserve a percentage of the land in its natural state,” it also promises multiple golf courses, whose grassy slopes would require huge amounts of water and fertilizer in a cactus-studded plain.

They plan to get much of the water from wells on what they describe as underused former farm allotments, and from a desalinization plant.

Mexican law allows developments in and around many protected areas if studies find they will not have serious environmental impacts, but the permits are being challenged in Mexican courts by the Mexican Center for Environmental Law, which argues that studies for the new project are incomplete.

Critics say authorities granted the permits in this case either because they wanted the outside investment, or were afraid of the consequences if they didn’t: under trade pacts like those signed by Mexico, investors can sue governments who unfairly affect their interests.

The department’s Aguilar said that if the government fails to properly give a company an opportunity for a permit, then “I as a government agency get myself into a problem, because I am violating the rights of an applicant.”